In this Panasonic TZ5 image, shot under near-ideal lighting, there's a shadow crossing the castle diagonally about 900 pixels in from the left side of the photo. Note that the bricks to the right and left of the shadow area are pretty clearly defined, while the bricks within the shadow area are so badly smeared, they're not even visible as bricks.
As bad as this is, it's about the best you can get from a camera with a 1/2.33 sensor. More importantly, this image illustrates why so many photographic forum principals are wrong in insisting that small-sensor cameras have wider angle lenses, and sacrifice the long zoom to get the wider angle. Landscapes and large people-group photos using small-sensor cameras produce too much pixel smear, so for my money, I'd prefer the longest zoom possible, starting around 40 mm effective on the wide end.